On the first business day after bakers went on strike against Hostess Brands, the Irving-based company said Monday it will permanently close three striking bakeries, putting 627 employees out of work.

Late Friday, the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union went on strike against Irving-based Hostess to protest cuts and give-backs in the company’s last, best, final contract offer. The contract, which was rejected by 92 percent of the union members who voted, called, in part, for 8 percent pay cuts, a company hiatus from contributions to a multi-employer pension plan and changes in work rules.

As of Monday, bakers had set up picket lines at about 23 of the 36 bakeries and production plants operated by the bankrupt snack maker. Hostess said the strike “has prevented the facilities from producing and delivering products.”

“Our customers will not be affected because we will continue to serve them from other Hostess Brands bakeries, but sadly this action will result in the permanent closure of three facilities and the loss of 627 jobs,” said Gregory Rayburn, Hostess Brands’ chief executive.

“We deeply regret this decision, but we have repeatedly explained that we will close facilities that are no longer able to produce and deliver products because of a work stoppage — and that we will close the entire company if widespread strikes cripple our business.”

The bakeries to be closed immediately are in Seattle, St. Louis and Cincinnati. The Seattle facility employs 110 people and produces Hostess cake products. The St. Louis facility employs 365 people and produces Hostess cakes and Nature’s Pride and Wonder breads.

This episode is a good illustration that there is a difference between a smart union that knows when they need to give in, and a stupid union.

Since its a privately-held company, the unions couldn't access the books, but rather than go all angry fire and brimstone, the teamsters wisely hired independent consultants to take a good, long, hard look at the company. Those consultants came back and said "look, based on what we do know from court documents the company is not in great shape and is heavily in debt. Here's the bad news: that debt is now owned by hedge funds. Those hedge funds are now management, and those guys are not businessmen, they are cold-blooded reptiles. If they don't see an easy, clean path to getting their money back through a new contract and concessions, those bastards will pull the plug, fire everyone, and sell off the company, so you'd better agree to their final offer"

The baker's union was run by a bunch of morons. They had no sophisticated outside experts giving them good unbiased advice, they were all angry, emotional, and led by fire-breathing hellraisers convinced that the company was lying. They ignored the Teamsters who pleaded with them to accept the contract, and put up enough of a roadblock to make their new owners give up on finding a new deal.

edit: apparently Hostess did open their books recently, and thats what prompted the Teamsters to conclude that it was not a bluff. From another article:

Quote:

Ken Hall, the Teamsters secretary-treasurer, said his union didn't doubt Hostess' claims after seeing its books.

"I think it's obvious there was no bluff," said Hall. "Our financial advisers had looked at their books, they had total access. We pushed them in negotiations to where we thought it was the absolute limit, that we would get the most for our members and [still] have a pathway back to prosperity for the company. The bakers' union disagreed with that."

Washington (CNN) – Several major labor unions are banding together to launch an ad campaign next week urging members of Congress to raise tax rates on the wealthiest Americans and to protect entitlement programs from major cuts as a solution to the looming fiscal cliff, a source with knowledge of the effort told CNN Friday.

The American Federation of State, County and Municipal Employees, the Service Employees International Union and the National Education Association are banding together for this campaign, which will be launched next week.

The effort will include a “six figure” buy of television ads, as well as ads online, the source told CNN.

The groups will argue, using new polling data, that the public does not favor major cuts in entitlement programs like Medicaid, but wants to see a solution to curbing the nation’s deficit based on raising the tax burden on the wealthier parts of the population, as well as policies that encourage job growth.

This episode is a good illustration that there is a difference between a smart union that knows when they need to give in, and a stupid union.

Since its a privately-held company, the unions couldn't access the books, but rather than go all angry fire and brimstone, the teamsters wisely hired independent consultants to take a good, long, hard look at the company. Those consultants came back and said "look, based on what we do know from court documents the company is not in great shape and is heavily in debt. Here's the bad news: that debt is now owned by hedge funds. Those hedge funds are now management, and those guys are not businessmen, they are cold-blooded reptiles. If they don't see an easy, clean path to getting their money back through a new contract and concessions, those bastards will pull the plug, fire everyone, and sell off the company, so you'd better agree to their final offer"

The baker's union was run by a bunch of morons. They had no sophisticated outside experts giving them good unbiased advice, they were all angry, emotional, and led by fire-breathing hellraisers convinced that the company was lying. They ignored the Teamsters who pleaded with them to accept the contract, and put up enough of a roadblock to make their new owners give up on finding a new deal.

edit: apparently Hostess did open their books recently, and thats what prompted the Teamsters to conclude that it was not a bluff. From another article:

From a teamster angry at the bakers:

Obviously this isn't the first time for union stupidity. Many years ago, there was one of the last large shoe manufacturers left in southern Missouri. With growing pressure from imports, they could not give employees the expected annual pay raise and the union went out on strike. The family owned business gave the union a copy of their books and asked then where they could cut costs to pay for a pay raie. The union leaders were adamant that the the company provided a "deceitful set of second books" and not the real ones. The company had no choice but to close their four plants and 1,200 people were out of a job. The company tried to hang on by importing their line of shoes, but eventually went bankrupt.

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This is the place where brilliant minds assemble to willfully pool ignorance with questionable logic in order to reach absurd conclusions.

Mom went to school with a lady that worked at Hostess. She said there were 18500 employees in the company and only 5000 employees in the union. And I assume that 5000 was split between the two unions. So a couple thousand people caused 18500 to lose their jobs. What a bunch of ****holes.

Mom went to school with a lady that worked at Hostess. She said there were 18500 employees in the company and only 5000 employees in the union. And I assume that 5000 was split between the two unions. So a couple thousand people caused 18500 to lose their jobs. What a bunch of ****holes.

no, those 5,000 were in the baker's union.

The teamsters were actually a lot larger, it was the smaller union that killed hostess.

__________________
<ptp> how many emo kids does it take to change a lightbulb?
<Willy> HOW MANY?!
<ptp> none they just sit in the dark and cry

Mom went to school with a lady that worked at Hostess. She said there were 18500 employees in the company and only 5000 employees in the union. And I assume that 5000 was split between the two unions. So a couple thousand people caused 18500 to lose their jobs. What a bunch of ****holes.

Careful now, you're not allowed to mention someone you know who said something. Not here anyway.

Don't really see a problem. When 92% of the workforce says no, then clearly it was an unacceptable contract. Hopefully they thought long and hard about the alternatives if the plants were closed, but taking an 8% pay cut and cessation of payments into their pension plan is a fairly big hit they were being asked to take.

I love the attitude of so many on here who seem to basically support employers no matter what they do. I'm hardly a die-hard labor supporter, but some of you guys are over the top.

Employer doesn't have to stay in business if the union makes it more trouble than its worth.

Employees don't have to accept pay cuts to keep their jobs.

I don't see the problem -- they both seem to have gotten what they want.

The teamsters were actually a lot larger, it was the smaller union that killed hostess.

Yep.

I've worked in areas where unions are definitely needed and actually helpful in certain respects, bringing real value to the table.

I've also worked in areas where the unions exist only as a covert form of extortion, bringing nothing of value to the process and actually sucking quality and jobs out of the final product by their presence.

This episode is a good illustration that there is a difference between a smart union that knows when they need to give in, and a stupid union.

Since its a privately-held company, the unions couldn't access the books, but rather than go all angry fire and brimstone, the teamsters wisely hired independent consultants to take a good, long, hard look at the company. Those consultants came back and said "look, based on what we do know from court documents the company is not in great shape and is heavily in debt. Here's the bad news: that debt is now owned by hedge funds. Those hedge funds are now management, and those guys are not businessmen, they are cold-blooded reptiles. If they don't see an easy, clean path to getting their money back through a new contract and concessions, those bastards will pull the plug, fire everyone, and sell off the company, so you'd better agree to their final offer"

The baker's union was run by a bunch of morons. They had no sophisticated outside experts giving them good unbiased advice, they were all angry, emotional, and led by fire-breathing hellraisers convinced that the company was lying. They ignored the Teamsters who pleaded with them to accept the contract, and put up enough of a roadblock to make their new owners give up on finding a new deal.

edit: apparently Hostess did open their books recently, and thats what prompted the Teamsters to conclude that it was not a bluff. From another article:

From a teamster angry at the bakers:

Actually, the Teamsters Union suggested that the concessions not be accepted. The members voted to accept them.

Once again, its blame American Workers time, unions are the bogey man. Maybe, for just a bit more perspective:

Since 2002 Hostess has hired 6 CEOs and none were able to turn the company around.

Hostess began closing plants in 2003.

In 2004, after failed restructuring, Hostess filed for bankruptcy. The BCTGM (that's the union in question here) agreed to wage and benefit concessions saving the company a reported 110 million. Money that was never reinvested into the company.

In 2009, emerging from bankruptcy, Hostess is controlled by a private equity firm and two hedge funds. Company's debts grow while sales decrease. Hmmm, anybody remember the Kaybee Toys saga?

In 2011 company is floundering and blames unions demanding concessions again. Workers refuse. Why would you give again to a company that didn't reinvest the first time around and now using "equity" strategies to benefit the executives?